Aereo Boston Launch Draws Broadcaster Ire

CBS readies lawsuit in Beantown

Aereo, the Barry Diller-backed controversial pay TV service that streams TV signals over the Internet, has selected Boston as the next market in its planned 22-city rollout. The service will launch May 15 for preregistered consumers followed by a May 30 marketwide launch.

For Aereo, that means a potential 4.5 million new customers. But it will also undoubtedly mean more lawsuits by broadcast owners that claim Aereo is infringing on their copyright.

CBS, owner of WBZ in Boston, confirmed to Adweek that it will file suit. "Stealing our signal will be found to be illegal in Boston, just as it will be everywhere else," CBS said in a statement.

In fact, broadcasters have been waiting for the opportunity to file against Aereo in another market after New York courts twice refused to halt the service. That lawsuit continued to drag on last week when New York TV station owners petitioned the Second Circuit Court of Appeals for an en banc hearing. A hearing on the merits of the case is likely for early next year. 

Other TV owners in the market that may file in Boston include many of the same New York station owners such as Fox and Univision, as well as Hearst Television (owner of the ABC affiliate) and Sunbeam Television (owner of the NBC affiliate).

By challenging Aereo in every city in which it launches, broadcasters hope to gain the upper hand in the courts. Broadcasters have already gotten a favorable finding in California against an Aereo wannabe (called Aereokiller) that used the same kind of technology. Different decisions could force the case all the way to the Supreme Court.

Aereo charges consumers $8 to $12 per month for the service, which also includes about 20-40 hours of cloud DVR storage for access to local, over-the-air TV signals. In New York, Aereo has managed to dodge the claim it is violating copyright by arguing that because it is renting an antenna (tiny, though it is), it isn't providing a public performance. 

If broadcasters can't win in the courts, they can go to Congress, or change the network TV business to a subscription model as News Corp. CEO Chase Carey suggested a few weeks ago.

Just how successful Aereo has been is unclear because the service won't reveal its subscriber numbers. Various reports have pegged the subscriber numbers in New York at only about 3,000.

"If Aereo's business is as successful in Boston as it's been in New York, it has its own problems to deal with," CBS said.